We the people reject ISDS. So why are our governments trying to expand it?

Stop ISDS | 3 April 2019

We the people reject ISDS. So why are our governments trying to expand it?

by Alex Scrivener

This week in New York, a meeting is taking place that will not attract very much media interest. On the face of it, that isn’t surprising. The meeting of Working Group III of the UN Commission on International Trade Law (UNCITRAL) hardly sounds like scintillating front page news.

But in amongst the lobbies of UN HQ, softly spoken EU negotiators are in fact working directly against the interests of the people of Europe. For they are negotiating a huge expansion of the hated Investor-State Dispute Settlement (ISDS) system of obscure corporate courts that multinationals use to sue governments and bully them into submission.

This is the very same system that helped unite over 3.2 million people to reject TTIP – the EU-US trade deal that included ISDS. Fears that US companies would use ISDS to do everything from preventing environmental regulations to locking in the privatisation of public services were core to the huge outpouring of anger driving that campaign.

This year, another half million have already signed a petition demanding that ISDS be eliminated completely.

So it is a democratic travesty that instead of heeding these calls and abandoning ISDS, the European Commission is pushing hard in New York to secure a huge expansion of the system in the form of a permanent Multilateral Investment Court (MIC).

The scheme’s backers claim that the MIC is not the same as ISDS.

They are wrong. It is.

In fact, by making the system permanent, the MIC could make ISDS worse by scaling it up. Rebranding the system does nothing to change the core injustice behind it. It remains a one-sided system (only companies can sue states not vice versa) that allows multinationals and billionaires access to a separate, privileged “justice” system.

It’s not just a court for the 1%. It is a court for the 0.01%.

The whole point of the system is to penalise governments for doing the right thing. Want to combat climate change and ban fracking? Improve workers’ rights? Regulate food additives for public health reasons? Well with ISDS you can forget it. You will be faced with threats and a big bill to pay (sometimes even if you manage to win the case – as Australia found when it won against a tobacco company suing over health warnings on cigarette packaging).

In this respect there is no difference between ‘classic’ ISDS and its newly rebranded MIC variation being proposed by the EU. No amount of tinkering with the precise way arbitrators are appointed will change the fundamental truth. ISDS is wrong.

With any luck, countries that have already taken the lead in rejecting the unfair ISDS system – like Indonesia and South Africa – will block these horrible proposals. But the question for us as Europeans is this: Why are people supposedly negotiating on our behalf trying to promote something citizens have clearly rejected?

Part of the answer is that the advice the negotiators are getting is questionable to say the least. It has been revealed that around two-thirds of academic advisors to the EU on ISDS have conflicts of interest (usually because they are paid ISDS counsels and have a vested interest in the survival of the system).

But ultimately, changing this situation is up to us. Clearly the Commission have not got the message. Our member state governments have not got the message. We the people reject ISDS in all its forms. This is why, like we did with TTIP, our campaign will work tirelessly to change this policy. And like with TTIP, we may well win.

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